Apple increases App Store prices in Europe

Apple has increased the prices of apps sold through its iTunes App Store in Europe because of exchange rate changes, it said on Friday. The minimum price for an app in the Euro zone rose to €0.89 ($1.15) from €0.79.

App Store users who tried to purchase a new app from the App Store on Thursday night in Europe were notified that the service was temporarily unavailable. An hour or so later the service was back up, with higher prices in euros for all apps in store.

Apple requires developers to put their apps into one of a limited number of price “tiers”, with Apple itself deciding what price will be charged for each tier.

The Dutch App Store now reflects the higher prices set by Apple to adjust for the exchange rate.

On Thursday night it put up the prices in euros of all tiers, so apps that were on sale for €1.59, for example, now cost €1.79, while apps previously sold for €4.99 now cost €5.49. The proportion of the price going to developers stayed roughly the same, with Apple taking about 39 percent of the price and developers 61 percent.

Only euro pricing changed, said Apple spokesman Alan Hely in an email. “From time to time Apple adjusts prices of products in countries due to changes in exchange rates,” he wrote.

Thomas Engel, Creative Director at Amsterdam-based mobile development firm The Saints, thinks value-added taxes may also have played a role.

“I think they compensated for currency and VAT changes,” he said.

“App providers are probably glad,” he said, as they get a little more money with the new prices.

A developer now gets €0.54 for an app in the lowest pricing tier, €0.89, €0.06 more than previously, according to a table detailing the pricing differences published by Apple Lounge.

Engel also thinks that the pricing for consumers is still right. “They haven’t breached the magic €1 barrier,” he said, which is important because that is seen as a psychological threshold by consumers. At €0.89 people are probably still inclined to make an easy purchase because the amount is small enough for them to not really care, he said.

“It feels like this is the new standard for the coming years,” said Engel, who added that it isn’t Apple’s style to update prices frequently. “We will have to accept it.”

Besides updating Euro app pricing, Apple also allowed buyers in a number of countries to pay in their local currency rather than in U.S. dollars as before. New currencies supported include Russian rubles, Turkish lira, Indian rupees, Indonesian rupiah, Israeli shekels, Saudi Arabian riyals, South African rand, United Arab Emirates dirhams and Danish kroner.